FaO Suggests Four Countries to Address Constraints on Indian Rice Export
Published on: November 8, 2023.
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Rice Exports to Increase in Asia Despite Decline in India and Vietnam
Rice exports from India and Vietnam have experienced a decline, but other countries in Asia such as Thailand, Pakistan, Myanmar, and Cambodia are projected to compensate for this decrease, resulting in a 6 percent increase in overall rice exports from the region, according to the Food and Agriculture Organization (FAO).
In the “Crop Prospects and Food Situation” report by the FAO, it is predicted that global rice reserves will recover by 1.5 percent year-on-year, reaching a peak of 198.9 million tonnes by the end of the 2023-24 marketing season. The increase in reserves is expected primarily in India, with additional contributions from Pakistan and the US, which can offset the stock drawdowns in other major rice-exporting nations.
India, however, has implemented restrictions on rice shipments since September 2022, impacting its exports. These measures include a ban on damaged rice shipments and white rice exports, a 20 percent duty on parboiled rice, and a minimum export price of $950 per tonne for basmati rice shipments. These restrictions aim to ensure food security due to adverse weather conditions affecting paddy crop production. Rice production in India is estimated at 106.31 million tonnes, falling short of the 112 million-tonne targets due to last year’s kharif production of 110 million tonnes.
The decline in rice exports from countries like Thailand has contributed to a 2 percent reduction in global rice prices in October compared to September, as reported by the FAO. The FAO’s All Rice Price Index averaged 138.9 points in October 2023, experiencing a 24 percent increase from the previous year.
In Asian markets for Indica rice, which is produced by India, significant deals were limited to continued purchases by Indonesia’s Bulog in October. India also approved shipments of 1 million tonnes to seven countries to address food emergencies in African nations and fulfill bilateral commitments. However, overall exports across Asia declined.
In Thailand, weak offshore demand was compounded by the weakening of the baht against the US dollar. In Pakistan, the impact of a rebound in the Pakistani rupee’s value on prices was offset by new crop arrivals. Vietnamese rice quotations were more resilient, particularly for lower-grade rice, due to tighter export availability.
Price Changes in Rice Markets
In terms of price changes, Thailand’s 5 percent broken white rice prices decreased by 5 percent to $584 per tonne from $612 between August and the present. Moreover, its 25 percent broken white rice prices dropped by nearly 8 percent to $558 from $605. Bangkok’s parboiled rice prices also decreased to $584 from $615.
In India, parboiled rice prices currently range from $498 to $502 per tonne, compared to $478 to $482 previously. In Vietnam, white rice prices increased, while Pakistan offered its rice at a significant discount compared to Thailand’s prices, ranging from $20 to $60 per tonne.
Despite the challenges faced by India and Vietnam in exporting rice, other Asian countries are expected to ramp up their exports, resulting in an overall growth of 6 percent in rice exports from the region. Additionally, global rice reserves are projected to recover, primarily due to increases in India, with some contribution from Pakistan and the US. Rice prices have fluctuated across different markets, influenced by factors such as exchange rates and harvest progress.
Source: Krishi Jagran
